SRC-AAA S.B. 1375 75(R)BILL ANALYSIS


Senate Research CenterS.B. 1375
By: Nixon
Finance
4-28-97
Committee Report (Amended)


DIGEST 

Currently, there are two methods of appraising leaseholds, the possessory
method and the equity method.  The law is ambiguous as to which method
appraisal districts are required to use. This bill requires an appraiser
to use the equity method  to make certain determinations and calculations.

PURPOSE

As proposed, S.B. 1375 requires an appraiser to use the equity method  to
make certain determinations and calculations.  

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Section 23.13, Tax Code, to require an appraiser to use
the equity method of valuation, when appraising a leasehold or other
possessory interest in real property, subject to the limitation provided
by Subsection (b).  Makes a nonsubstantive and a conforming change. 

SECTION 2. Amends Chapter 41A, Tax Code, by adding Section 41.035, as
follows: 

Sec. 41.035. CHALLENGE RELATING TO CERTAIN TAXABLE LEASEHOLDS.  Sets forth
challenges relating to certain taxable leaseholds. 

SECTION 3. Amends Chapter 41C, Tax Code, by adding Section 41.414, as
follows: 

Sec. 41.414. PROTEST RELATING TO CERTAIN TAXABLE LEASEHOLDS.  Sets forth
requirements regarding protest relating to certain taxable leaseholds. 

SECTION 4. Amends Section 42.031, Tax Code, by adding Subsection (c), to
set forth a situation whereby the state or political subdivision of this
state may intervene in an appeal of the appraisal review board order.
Provides that this section prevails over Subsection (b), if any conflict
arises. Provides that a state or political subdivision of this state is
not a necessary party to the appeal. 

SECTION 5. Effective date: September 1, 1997.

SECTION 6. Emergency clause. 

SUMMARY OF COMMITTEE CHANGES

Amendment 1.

Amends SECTION 2, Chapter 41A, Tax Code, by adding Section 41.035, to set
forth challenges relating to certain taxable leaseholds. 

Amends SECTION 3, Chapter 41C, Tax Code, by adding Section 41.414 to set
forth requirements regarding protest relating to certain taxable
leaseholds. 
 
Adds SECTION 4, Section 42.031, Tax Code, by adding Subsection (c), to set
forth a situation whereby the state or political subdivision of this state
may intervene in an appeal of the appraisal review board order.